Seneca21

Could he not transfer ownership of them to a UK resident he trusts?

Wol

Comes under the heading of "Evasion" rather than "Avoidance" I would suggest. Even accepting that you can find someone who will not disappear with the £1m, when you took ownership again - as I assume you would want to, otherwise what's the point? - you would be liable to tax plus any currency gain's tax.

Seneca21

Hardly evasion or avoidance if he legitimately gave the sum to his brother, for example, and was not given the sum back again. There are lots of naughty people in this world who have free access to "other people's" bank accounts via a card.

I would pay the tax because I like a good night's sleep and I'm not desperate for money, but my point is there are lots of naughty little people out there who have access to "family members" bank accounts. It literally is not their money, but they're the ones that spend it.

Wol

Intention is the issue in the courts, as well as the facts of ownership.

Agreed, loads of people get away with tax evasion tactics every year but you only have to get rumbled once and you will be in the ATOs sights for evermore.

I think anyone who "gives" money to someone else in the context we are talking about, whether family or not, needs their head examining.

Seneca21

I agree. If you were actually to win this million pound prize money and get whacked with the (disgraceful) non-residents levy, you still end up with 500k sterling (I presume it 50%). Who has a problem with that? I'd be more than happy but then I don't have the kind of money to invest in this way so maybe they think differently.

I read somewhere that you have to have pretty massive numbers of premium bonds to win anything anyway. Like anything else in life - loaded against the poor.

ABCDiamond

Currently at 1.5%

Odds are 24,000 to 1 to win anything.

The top 5 winners last month had holdings of:
£30,000
£23,000
£25,010
£280
£30,000

One guy bought a £2 bond in 1964 and won £1,000 with it last month. His total holding was £12. That works out at a return rate of .... 9.5% per year

NedKelly

You can get 3.40% in Nationwide International.

http://www.nationwideinternational.c...s/sterling.htm

iamthecreaturefromuranus

Hypothetically, as I don't have any premium bonds, I wonder how long you would have to move back to the UK for to be able to claim your million quid tax free... and then move back to Oz again, should you choose to.

Wol

Devious b*st*rd, ain't you

markbhx

And how would the ATO know about the winnings?? Obviously transferring all that to your oz account they will find out.

It would be easy to avoid tax on it by using your UK credit card for large buys in oz then use the winnings in your UK account to pay it off. With a million quid in your UK account I'm sure you could get a credit card easy enough with 100 grand limit the same bank.

We got a Tesco credit card just last month using our UK property address that is rented out. The mail is redirected to oz.

Mr aussie tax man would never find out in that scenario.

Seneca21

Did I misunderstand Wol's point about tax? I presumed he meant the UK Government taxed you on the winnings because you wre not resident in the UK - not that the Australian Government taxed you - or do they tax you as well CGT or something when you bring it in? If so I would invest in the UK long-term and have it as a safety-net for old-age.

Wol

Bond winnings are free of UK tax, but as an Australian tax resident you would be liable for Australian tax as I understand it.

Seneca21

Liable upon international transfer into Australia, or just plain old liable as soon as you get the cash?

Wol

Bear in mind I'm not a tax expert but my guess would be that you'd be liable for income tax as soon as it goes into your UK account - and then liable for tax on any capital gain on the currency change when it comes over.

Seneca21

Sure I know you're just giving your views, thanks. My problem is that PB winnings are treated the same as gambling winnings in the UK and therefore not subject to tax. Do they tax gambling winnings in Australia then? If so this is starting to make sense.

If not I am struggling to see why anyone should pay tax on winnings won in the UK when they are not taxed in Australia, just because they are living in Australia - maybe even temporarily.